Some new home builders are offering creative solutions to entice homebuyers to build their move-up home rather than buy something pre-owned. If you have thought about building new construction, but worried about how to time the sale of your current home with the possession date of your new build, you may be curious about home builders who offer to sell your current house for you.
Read on to learn more about the pros and cons of using the builder’s real estate agent to sell your house.
Common pitfalls when building a new home and selling your old home
Buying a new construction home can be a great option. For some homebuyers, months of construction are worth the wait if it means they can get the customized floor plan and finishings they’ve always wanted. But long, unpredictable build times — particularly right now as builders are dealing with labour shortages and supply chain issues — make it very challenging to time the sale of your current home.
In addition to timing issues, homeowners relying on revenue from the sale of their current home to fund the downpayment on their new build may be wondering how to make it all work. Homebuilders have had to adapt to these common issues that may prevent some buyers from considering a new build.
How much is your home worth? Check comparable homes for sale in your neighbourhood.
Can you trust home builders who offer to sell your current house for you?
Many home builders offer to sell your current house to help alleviate the stress and pressure of timing your move. Some of them offer to list your current home as soon as construction starts and will extend the possession date of your new home if your old house doesn’t sell in time. They may even offer to pay the interest and carrying costs of your new home for the first 30 days. Others may even offer to buy your house from you.
These all sound like value-added services that help reduce the risks of building a new home. Sure, that may be true. And there may be homeowners who have happily pursued this option and feel as though it worked for them.
When clients ask me: “Wally, what do you think about home builders who offer to sell your current house?” I always tell them to think it through carefully and to ask the following questions first:
- What incentive does the home builder’s agent have to negotiate the best price for your home?
- Who’s on the hook for paying the buyer’s agent’s commission?
When buying or selling, you want someone acting on behalf of your best interests
In real estate, it’s not ideal to have the same agent representing both the seller and the buyer (this is called transaction brokerage). When you’re buying or selling a home, you preferably want your own agent. That way, you have an expert on your side who will advocate on your behalf to get the best outcome for you in the transaction.
In a transaction where the home builder is both selling you a new home and responsible for selling your current home, how can you be sure that they will act in your best interests in both transactions?
Don’t settle for convenience over unbiased advice and personalized service
The bottom line: if what your builder is offering in terms of selling your current home sounds too good to be true, well, it probably is.
When it comes to such an important transaction, don’t settle for any arrangement that doesn’t put your interests first and foremost. In addition to helping sell your current house, a trusted real estate agent can also discuss financing with you and connect you with mortgage brokers or other financial professionals who can help with bridge financing options for your new home.
Torn between building a new home vs buying pre-owned? With over 15 years of experience, Wally can walk you through the options and help you decide which is best for you.
Call/text Wally today at 780.238.7384